The rising cost of a healthy diet: changing relative prices of foods in high-income and emerging economies

Everywhere in the world the share of the overweight and obese population is increasing, no more so than in the emerging economies of the developing world. No country has stemmed the increase. Effective policies to combat obesity have yet to be proved, if only because no country has yet tested a sufficiently comprehensive set of policies.

Understanding the causes of increasing obesity matters. The rise of obesity corresponds to multiple factors, but one that is imperfectly understood is changing relative prices of different foods, arising from technical advances in both growing food as well as in processing and marketing it. If people are increasingly eating foods dense in nutrients, and especially processed foods, is that because they are influenced by cultural stimuli such as media and advertising; or is it because these foods have become relatively cheap compared to unprocessed food?

Foods that become cheaper compared to others are likely to be consumed more. So are high calorie diets becoming cheaper compared to more healthy options?

This has been the trend in high-income countries over the last 30 years. But what has been happening to the prices of different foods in some of the rapidly-growing emerging economies where incomes have risen notably in the last 20 years? In this report we investigate changes to the retail prices of foods in Brazil, China, Republic of Korea and Mexico.

We also look at the political appetite to contemplate taxing foods and whether taxes and subsidies could encourage more consumption of healthy foods and less of unhealthy items.